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Home My WebLink About1986-05-06; City Council; 8542-2; BATIQUITOS LAGOON EDUCATIONAL PARK ASSESSMENT DISTRICT SELECTION OF UNDERWRITERSB ,,',* 'e . CI~F CARLSBAD - AGEND~ILL BATIQUITOS LAGOON EDUCATIONAL PARK Adopt Resolution No.BSv/ selecting Stone and Youngberg as the Ci underwriter for the Batiquitos Lagoon Educational Park Assessment D Item Explanation: The City Council at their meeting of March 12, 1986, approved proct with the formation of the Batiquitos Lagoon Educational Park Assessr District for the construction of certain public improvements. At the meeting of April 1, 1986, the Council approved the hiring of a proje coordinator, engineer and legal counsel. Staff is now recommending the City Council complete the assessment district team with the appo of the underwriter who will be responsible for buying the bonds. The firm of Stone and Youngberg is recommended as the underwrite] this issue for several reasons. First, Stone and Youngberg handles majority of the 1915 Act bonds sold in the State of California. Thei: extensive experience in underwriting issues of this type will be an 2 to the City when bonds are finally marketed. Second, Stone and Yc has shown their willingness to work with the City in a fair and comr manner, as can be seen in their participation in the South College A District. Third, in issues of this type, a negotiated rather than coi sale is commonly used. This allows the City and the underwriter to the timing of the issue to take advantage of market changes that ma, the City's position. Staff is recommending selecting an underwriter at this time to allow underwriter to be involved in the process of structuring the issue. There are several underwriters capable of assisting the City with th type of issue, however Stone and Youngberg's close contact with thj project to date and with the City staff on past issues is a major fad in this recommendation. cs LLJ Fiscal Impact: P 0 fr: a ck 4 The full cost of this assessment district will be borne by the develo] The underwriter fees are taken from the proceeds of the issue. Thl of a negotiated sale rather than competive bid will not affect the ult. cost of the issue substantially and may reduce total underwriter feeE compared to other competitive sales. Resolution No. a541 approving an agreement with Stone and You to act as underwriter for the Batiquitos Lagoon Educational Park As1 District and authorizing th Mayor to execute same. b 4 1 2 3 4 5 6 7 a 9 10 I1 12 13 14 15 16 17 18 19 20 21 22 1 I e e RESOLUTION NO. 8541 A RESOLUTION OF THE CITY COUNCIL OF THE CITY ( CARLSBAD, CALIFORNIA, APPROVING AN AGREEMENT WITH STONE AND YOUNGBERG TO ACT AS UNDERWRI' FOR THE BATIQUITOS LAGOON EDUCATIONAL PARK ASSESSMENT DISTRICT AND AUTHORIZING THE MAY0 TO EXECUTE SAME. WHEREAS, the City Council has directed staff to proceed with formation of the Batiquitos Lagoon Educational Park Assessment Disi WHEREAS, the City Council has determined that it is in the C best interest to sell bonds resulting from this assessment district tl: negotiation with a single underwriter, and WHEREAS, the City Council has determined that the firm of S and Youngberg can best serve the City as underwriter due to their in bond issues of this type, familiarity with the project and past sc to the City. NOW, THEREFORE, BE IT RESOLVED by the City Council of City of Carlsbad that the attached agreement (Exhibit A) with Stor Youngberg is hereby approved and that the Mayor is authorized to this agreement on behalf of the City. PASSED, APPROVED AND ADOPTED at a regular meeting of 6th 1 City Council of the City of Carlsbad, California, held on the May , 1986, by the following vote, to wit: ~ of AYES:. Council Members Casler, Lewis, Kulchin, Chick and Pet 23 I 26 251 24 i 27 28 NOES: None ABSENT: None y!?L* d &<< MARY H/ CASLER, Mayor ILTTEST: ACW. dUT!fkRA*yylerk (SEAL) 0 e 1. SYIY"V3E &, YOUNGBERG MEMBERS PACIFIC STOCK EXCHANGE April 15, 19% Citj Council City of Carlsbad 1200 Elm Avenue Carlsbad, CA 92008 RE: Batiquitos Lagoon Honorable Council Members: This letter will serve as an agreement between the City of Carlsba ("the Cityt@) and Stone & Youngberg (stthe Underwriters#$) to serve a Underwriters to the City until the parties enter into an actual Purchas Contract regarding the negotiated sale of improvement bonds in th principal amount of approximately $5,000,000 for the above-name project to be issued by the City pursuant to the Improvement Bond Act o 1915 ("the Bonds*t). You have informed us that the City intends to issue the Bonds t provide funds for financing various public improvements and for thi purpose requires the services of the Underwriter to render advice as t the structure of the financing and to enter into a Purchase Contracttha is agreeable to the City. As Underwriters, we will use our best efforts to bring the Bonds t market at reasonable rates under then existing conditions. Tt Underwriters agree to undertake the below 1 isted services and functions. A. Structurlns the Financinq: 1. The Underwriter will advise the City on methods of improving tt feasibility and marketability of the project and the Bonds. 2. The Underwriter will work with the City's bond counsel ar property Owners in recommending specific terms and conditio1 affecting the Boiids. 3. The Ilndaiwriters wi7 1 prepare an Offering Memorandurn (prel imina and final versions, respectively) for sale of the Bonds. Althou! it will be the responsibility of the Underwriters to prepare tl Offering Memorandum, the City agrees to participate in i. preparation by providing pertinent information to be includc therein and review the Offering Memorandum for accuracy as relates to matters concerning the Bonds, the Project and the City 1127 WALL STREET * PO BOX 1024 * LA JOLLA, CALIFORNIA 92038 * (714) 454-9081 * 0 0 City Council April 15, 1986 City of Carlsbad Page Two Said Offering Memorandum will include a description of the Bond and their security and pertinent financial economic data. Th execution and delivery of the Offering Memorandum will be dul authorized by the City for use in marketing the Bonds. B. Marketina the Bonds 1. At the designated time for sale of the Bonds, the Underwriter will submit an offer to the City to purchase the Bonds, subject t pertinent resolutions, the Offering Memorandum, and a1 1 othe necessary documents, approvals, and proceedings governing SUC Bonds having been determined by bond counsel, the City, and th Underwriters to be satisfactory in all respects for financin purposes. It is intended that, once purchased, the Bonds will b re-offered to the public on the basis of an immediate fltbona fid public offering”. The Underwriters may form a group of investmen banking firms for the purpose of underwriting and selling th Bonds. 2. At least one day prior to the submission of any such formal offe to the City for the purchase of the Bonds, the Underwriters wil indicate to the City the interest rate or rates, the purchas price from the City, and public offering price of the Bonds whic we then estimate will be included in such offer. If afte negotiations in good faith, the City and the Underwriters fail t agree on terms of sale of the Bonds, and upon written notice t the Underwriters, the City may then offer the Bonds for sale t others . C. General Provisions Relating to the Citv and the Underwriter 1. The City agrees to make available to the Underwrlters xithou cost, sufficient copies of any applicable reports, agreements contracts, resolutions, and other re1 evant documents pertaining t the Project, the City or the Bonds as reasonably may be require from time to time for the prompt and efficient performance by th Underwriters of thei r ob1 igations hereunder. 2. The Underwriters shall pay its own out-of-pocket and othe expenses, including printing of Blus Sky and Investment :.lemorandu and any advertising expenses in connection with the publi offering of the Bonds. 3. The City shall pay from the proceeds of the Bonds or other fund of the City all costs and expenses customarily paid therefrc including the cost of printing the Bonds and any other documents the fees and expenses of its legal counsel, bond counsel accountants, architects, angineers and of any cther expert retained by the City in connection Kith the financing. . * e : City Council April 15, 1986 City of Carlsbad Page Three 4. It is expressly understood and agreed and the City hereb recognizes that in performing its activities, the Underwriters ar acting proposal to parchase the Bonds for resale. Nothing herein shal be construed to make tha Underwriters an employee or financial fisca.1 or other advisor of the City, or to establish any fiduciar relationship between the City and the Underwriters. 5. This agreement shall extend to the date of sale of the Bonds a contemplated herein, when the formal bond Purchase Contract i entered into by the parties. 6. The City may terminate this, agreement at any tins on or after tk follouing receipt by ti- last day of Underwriters of -'- written notification from the City. Upc termlination of this agreement, the City shall be under no furthe ob1 igation to the Underwriters hereunder. solely on their own behalf and plan to submit to the City e-- %//?j ~ , (-; 6 6 < -& Upon your acceptance set forth below? this letter will constitute a agreement between the City and the undersigned. Please return one signe copy of this agreement. Very truly yoursp STONE 8, YOUNGBERG Rpbert L. Anderson 8 1986. + Accepted this o.=?/& day of - c.e,- RLAI nj r QQQlA